From technological advancements to changes in consumer behaviour, there are a lot of factors set to impact the vending industry in 2020.
Here, FoodBev explores five of the recent key trends currently driving vending, including an assessment of how the current Covid-19 pandemic is set to drastically influence the face of the industry.
IoT Technology
Internet of Things technology, or IoT, is a system of interrelated computing devices, mechanical and digital machines, or objects and allows connectivity between multiple devices.
IoT has provided vending companies with the opportunity to improve their businesses by tracking products and assessing what’s popular in machines. By tracking stocks through connected devices, companies can be instantly alerted about low stock levels in their vending machines, which may ultimately reduce expenses and improve customer service.
An example of the use of IoT in the vending industry is plug-and-play smart button devices that attach to machines, enabling individuals to contact facility management instantly, according to Sigfox.
It will be interesting to see the ways IoT technology is utilised by the industry throughout 2020. With benefits such as optimising maintenance schedules, retaining good stock levels, resolving issues fast and understanding customers better through data analytics, there is certainly a lot of potential for IoT deployment in the vending industry.
Cashless payments
In 2019, FoodBev Media listed cashless payments as one of the top trends for the vending industry, and as this trend continues to flourish, there is no doubt it will provide further opportunity for vending in 2020.
It is important for industries to keep up with consumer payment preferences and as cashless payments provide a quick and simple method of payment, a cashless future provides opportunity for vending businesses.
Cashless payments not only offer customers convenience, they also offer logistical solutions. Handling cash in vending machines is a costly process; Ingenico uses examples of time spent collecting and counting money to losses incurred through vandalism and theft as reasons for this.
According to Munster, there are over 252 million Apple Pay users worldwide, and the figure continues to grow. Many vending machines can now accept mobile payments or can link up to customer’s online accounts via apps.
We’ve already seen companies such as Nayax launch apps to cater for mobile vending payments. In May 2019, Stora Enso launched a new line of smartphone-operated vending machines, which are RFID (Radio Frequency Identification)-enabled, which they describe as “a natural step to enter the automated retail market”.
As the world becomes increasingly cashless and even cardless, a mobile payment continues to increase in popularity, how will we see vending technology develop further to align with these shifts in consumer behaviour?
Choice
The nature of snacking is evolving rapidly, particularly as consumers are becoming increasingly health-conscious. In a study by The Vending People, for example, they found that zero-sugar drinks were the most popular choice in 2019, seeing a 38.2% increase in sales.
Similarly, they sold 196% more low-calorie snacks compared with other options in 2019, indicating a stark increase in healthier choices within the past year. Vending customers are making more health-conscious choices, and as a result, the industry will need to adapt to meet consumer needs.
It is not just healthier options that many vending businesses are extending. The industry is also seeing an increased number of cooked foods that you would usually have to go to restaurants for, at the consumers convenience in self-service machines.
Pizza vending machines company Basil Street sells 10-inch Italian-style pizzas which are cooked from frozen in approximately three minutes, using a patent-pending three-element non-microwave speed oven.
With such original products and services hitting the vending industry recently, it will be exciting to see what other innovations extend choice even further this year.
Sustainability
The world produces 381 million tonnes in plastic waste yearly, which is set to double by 2034. 50% of this is single-use plastic, according to Condor Ferries, so there is no surprise that concern over the environmental impact of single-use plastics has rocketed in recent years.
In March 2018, the UK Government proposed a deposit return scheme (DRS), which aimed to reduce the levels of wasted plastics. As a result, reverse vending was listed as one of FoodBev’s top vending trends for 2019.
Last year saw various UK supermarkets, including Iceland, Tesco and Co-Op launch reverse vending trials. In August it was announced that over 1 million plastic bottles had been recycled through reverse vending machines in Iceland stores. More recently, we have seen local councils, such as Hackney, install reverse vending machines on estates as part of new trials.
Packaging suppliers, such as RPC Group, have also launched vending cup recycling initiatives within the past year, enabling vending suppliers and operators to deliver used cups to RPC’s facility to be recycled.
Reverse vending and recycling initiatives show the vending industry supporting a circular economy and providing an easy way for consumers to help reduce plastic waste.
The COVID-19 effect
At the beginning of 2020, it is doubtful that anyone would have been able to predict the unprecedented impact the Covid-19 pandemic would have on industries across the globe and this includes the vending industry.
President of the European Vending & Coffee Service Association (EVA), Paolo Ghidotti, has written an open letter to European leaders highlighting the “devastating impact” the pandemic is having on the vending industry, and has requested urgent financial assistance for the sector.
EVA has claimed vending operators are reporting business losses of up to 90% due to a majority of employees working from home. 80% of vending machines and coffee machines are located within offices and workplaces causing a fall in economic activity.
Ghidotti said: “National restrictions and work from home policies have particularly impacted our industry and already resulted in many vending companies struggling to maintain their previously viable activities”.
Vending machines are extremely important within healthcare facilities, as they are often the only available means for healthcare personnel to obtain food such as sandwiches and snacks without interaction.
At this point in time, we are only a few weeks into the pandemic so it will be interesting to see how the vending industry responds and hopefully recovers from these devastating effects.
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